This document is a summary of a Supreme Court of the Philippines case from November 18, 1916. The case involved a disputed land sale between Basilia Bough, Gustavus Bough and Matilde Cantiveros. The trial court had ruled in favor of the defendants, finding the deed of sale was fictitious and invalid. On appeal, the Supreme Court considered two assignments of error from the plaintiffs. For the first error, the Court found the defendants were properly allowed to present evidence of fraud regarding the deed of sale, even though they did not specifically deny its execution under oath. For the second error, the Court found there was sufficient evidence to support the trial court's finding that the deed of sale was executed under fraudulent
This document is a summary of a Supreme Court of the Philippines case from November 18, 1916. The case involved a disputed land sale between Basilia Bough, Gustavus Bough and Matilde Cantiveros. The trial court had ruled in favor of the defendants, finding the deed of sale was fictitious and invalid. On appeal, the Supreme Court considered two assignments of error from the plaintiffs. For the first error, the Court found the defendants were properly allowed to present evidence of fraud regarding the deed of sale, even though they did not specifically deny its execution under oath. For the second error, the Court found there was sufficient evidence to support the trial court's finding that the deed of sale was executed under fraudulent
This document is a summary of a Supreme Court of the Philippines case from November 18, 1916. The case involved a disputed land sale between Basilia Bough, Gustavus Bough and Matilde Cantiveros. The trial court had ruled in favor of the defendants, finding the deed of sale was fictitious and invalid. On appeal, the Supreme Court considered two assignments of error from the plaintiffs. For the first error, the Court found the defendants were properly allowed to present evidence of fraud regarding the deed of sale, even though they did not specifically deny its execution under oath. For the second error, the Court found there was sufficient evidence to support the trial court's finding that the deed of sale was executed under fraudulent
This document is a summary of a Supreme Court of the Philippines case from November 18, 1916. The case involved a disputed land sale between Basilia Bough, Gustavus Bough and Matilde Cantiveros. The trial court had ruled in favor of the defendants, finding the deed of sale was fictitious and invalid. On appeal, the Supreme Court considered two assignments of error from the plaintiffs. For the first error, the Court found the defendants were properly allowed to present evidence of fraud regarding the deed of sale, even though they did not specifically deny its execution under oath. For the second error, the Court found there was sufficient evidence to support the trial court's finding that the deed of sale was executed under fraudulent
RepublicofthePhilippines SUPREMECOURT Manila ENBANC G.R.No.13300September29,1919 BASILIABOUGHandGUSTAVUSBOUGH,plaintiffsappellants, vs. MATILDECANTIVEROSandPRESBITERAHANOPOL,defendantsappellees. P.E.delRosarioandWilliamF.Muellerforappellants. SisonandVelosoforappellees. MALCOLM,J.: This action was begun in the Court of First Instance of Leyte, pursuant to a complaint by means of which the plaintiffsBasiliaBoughandGustavusBoughsoughttohavethemselvesputinpossessionofthepropertycovered bythedeedofsalequotedinthecomplaint,andtorequirethedefendantMatildeCantiverostopaytheplaintiffs the sum of five hundreds pesos by way of damages, and to pay the costs. Matilde Cantiveros answered with a generaldenialandaspecialdefense,notswornto,inwhichsheaskedthatjudgmentberendereddeclaringthe contractofsaletheretoforemadebetweenherselfandBasiliaBoughnull.Theplaintiffs,thereupon,deniedunder oaththegenuinenessanddueexecutionofthesocalleddonationintervivosset forth in the answer. Presbitera Hanopol was permitted to intervene as a defendant. After trial, judgment was rendered by the Honorable W. E. McMahon,judgeoffirstinstance,infavorofthedefendants,declaringthedeedofsale,ExhibitA,fictitious,null, andwithouteffect,andabsolvingthedefendantsfromthecomplaint,withcostsagainsttheplaintiffs.Itisfromthis judgmentthroughtheordinarymeansofperfectionofabillofexceptionsthatthecaseisbroughttothiscourtfor decision. Thefactsarethese:MatildeCantiverosisreputedtobetherichestresidentofthemunicipalityofCarigara,Leyte. Inthelatterpartoftheyear1913,shewastheownerofvariousparcelsofrealtyofthevalueofthirtythousand pesos or more. On December 24, 1912, Matilde Cantiveros and her husband Jose Vasquez, signed a marital contract of separation. At this time there lived with Matilde Cantiveros, Basilia Hanopol, a cousin and protege sincechildhood,whowasmarriedtoGustavusBough.Forthisreason,GustavusBoughwasregardedbyMatilde Cantiveros with great confidence, even as her child. Through the influence of Gustavus Bough, who brought a story to Matilde Cantiveros that her husband Jose Vasquez was in town and might contest the contract for the separationoftheconjugalproperty,MatildeCantiveroswasinducedtosignafictitiouscontractofsaleofallher property to Basilia Bough. This document, introduced in evidence as Exhibit A, was prepared in due from and http://www.lawphil.net/judjuris/juri1919/sep1919/gr_13300_1919.html
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acknowledged before a notary public, the amount of the consideration, ten thousand pesos, being last inserted with a pen. By this deed, Matilde Cantiveros purported to convey sixtythree parcels of land, the real value of which was over thirty thousand pesos, for ten thousand pesos, although no evidence that any such sum ever passedbetweenthepartieswasintroduced,tohercousin,BasiliaBough.InordertoreassureMatildeCantiveros thattheywouldnottakeadvantageofthefictitioussale,GustavusBoughandBasiliaBoughpreparedandsigned anotherdocument,introducedinevidenceasExhibit1,whichisadonationbythemtoMatildeCantiverosofall thepropertymentionedinExhibitA,tobeeffectiveincaseofthedeathofthemselvesandtheirchildrenbefore thedeathofMatildeCantiveros.Thedefendant,MatildeCantiveros,hasremainedinpossessionoftheproperty. These facts, which, it may be said, are mainly derived from the findings of the trial court, merely repeat the threadbare story of a conveyance of property entered into with a fraudulent intention and for a fraudulent purpose,inordertodefeatrecoveryinasuitatlawbyathirdparty. Plaintiffsandappellantsassignsixerrorsofthetrialcourt.Insofarastheseassignmentsconcernthefacts,they need no discussion. Plaintiff's declarations have not been corroborated, while defendant's story has been corroboratedbyreliablewitnesses.Allthereasonalltheequityofthecase,isinfavorofthedefendants.As farasnecessaryforthedispositionoftheappeal,weresolveplaintiff'spointsinorder. 1.Thefirstassignmentoferrorreads:"ThelowerCourterredinpermittingthedefendantstopresentevidence, overtheobjectionsoftheplaintiff,tendingtoimpugnthegenuinenessanddueexecutionofthedocument,Exhibit A,andinadmittingthemtoshowthecircumstancesunderwhichitwasexecuted. Itisundeniablethatthiswasanactionbroughtuponawritteninstrument,andthatthecomplaintcontainedacopy of the instrument, but that its genuineness and due execution were not specifically denied under oath in the answer.Isthisfataltothedefense? Section103ofthePhilippineCodeofCivilProcedureprovides: Whenanactionisbroughtuponawritteninstrumentandthecomplaintcontainsorhasannexedacopyof suchinstrument,thegenuinenessanddueexecutionoftheinstrumentshallbedeemedadmitted,unless specificallydeniedunderoathintheanswerandwhenthedefensetoanaction,oracounterclaimstatedin an answer, is founded upon a written instrument and the copy thereof is contained in or annexed to the answer, the genuineness and due execution of such instrument shall be deemed admitted, unless specificallydeniedunderoathbytheplaintiffinhispleadings. Thissectionisderivedfromsections448and449oftheCodeofCivilProcedureofCalifornia,andistobefound invaryingforminthestatutesofpracticallyallthestatesoftheAmericanUnion.Themeaningofthisportionof theCode,andtheintentionoftheLegislatureinenactingit,areeasilyfound.Thelawsaysthatthegenuineness and due execution of a written instrument properly pleaded shall be deemed admitted unless the plaintiff or defendant, as the case may be, shall specifically deny the same under oath. When the law makes use of the phrase"genuinenessanddueexecutionoftheinstrument"itmeansnothingmorethanthattheinstrumentisnot spurious,counterfeit,orofdifferentimportonitsfacefromtheoneexecuted.Asanexample,wherethenameof acorporationissignedtothedocumentwhichisthebasisofanaction,thefailureofthedefendantcorporationto putinissue,bydenialunderoath,thedueexecutionoftheinstrument,asrequiredinsection103oftheCodeof Civil Procedure, operates as an admission of the authority of the officer to execute the contract, since the authority of the officer to bind the company is essential to the due execution of its contract. (Ramirez vs. Orientalist Co. and Fernandez [1918], 38 Phil., 634.) But the failure of the party to file an affidavit denying the http://www.lawphil.net/judjuris/juri1919/sep1919/gr_13300_1919.html
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genuinenessanddueexecutionofthedocumentdoesnotestophimfromcontrovertingitbyevidenceoffraud, mistake,compromise,payment,statuteoflimitations,estoppel,andwantofconsideration.Assection285ofour CodeofCivilProcedurepermitsawritingtobeimpeachedbecauseofitsillegalityorfraud,suchadefensewould notbebarredbytheprovisionsofsection103.(Moorevs.Copp[1897],119Cal.,429Brooksvs.Johnson[1898], 122Cal.,569Hibberdvs.RohdeandMcMillian[1915],32Phil.,476.) Weholdthatalthoughthedefendantsdidnotdenythegenuinenessanddueexecutionofthecontractofsaleof December 9, 1913, under oath, yet the defendants could properly set up the defenses of fraud and want of consideration. 2. The second assignment of error reads: "The lower Court erred in finding that the plaintiff Gustavus Bough, having prepared a contract of separation between the defendant Matilde Cantiveros and her husband, Jose Vasquez,soughttocausehertobelievethatsheexposedherselftoasuitbyherhusbandregardingherproperty, notwithstandingthecontractofseparation,andforthatreasonandforthepurposeofshieldingherselffromthe consequencesoftheapprehendedsuit,thatsheandhermotherexecutedthedocumentExhibitA." Counsel relies on the provisions of article 1218 of the Civil Code, which provides that "Public instruments are evidence,evenagainstathirdperson,ofthefactwhichgaverisetotheirexecutionandofthedateofthelatter." TheeffectofthisarticlehasbeenannouncedinnumerousdecisionsoftheSupremeCourtofSpainandofthis Court.(SeeHijosdeI.delaRamavs.RoblesandRobles[1907],8Phil.,712.)Butinconjunctionwitharticle1218 oftheCivilCode,thereshouldalwaysbereadsection285oftheCodeofCivilProcedurewhichprovidesthat: When the terms of an agreement have been reduced to writing by the parties, it is to be considered as containing all those terms, and therefore there can be, between the parties and their representatives or successorsininterest,noevidenceofthetermsofagreementotherthancontentsofthewriting,exceptin thefollowingcases: 1.Whereamistakeorimperfectionofthewriting,oritsfailuretoexpressthetrueintentandagreementof theparties,isputinissuebythepleadings 2. Where the validity of the agreement is the fact in dispute. But this section does not exclude other evidenceofthecircumstancesunderwhichtheagreementwasmade,ortowhichitrelates,ortoexplainan intrinsicambiguity,ortoestablishitsillegalityorfraud.Theterm`agreement'includesdeedsandintruments conveyingrealestate,andwillsaswellascontractsbetweenparties. Whilethusasthelawwellsays"publicinstrumentsareevidenceofthefactwhichgaverisetotheirexecution"and aretobeconsideredascontainingallthetermsoftheagreement,yet,ifthevalidityoftheagreementistheissue, parole evidence may be introduced to establish illegality or fraud. Evidence to establish illegality or fraud, is expressly permitted under section 285 of the Code of Civil Procedure, and may be proved by circumstantial evidence, aided by legitimate inferences from the direct facts. (Camacho vs. Municipality of Baliuag [1914], 28 Phil.,466Maulinivs.Serrano[1914],28Phil.,640UnionMut.LifeInsuranceCo.vs.Wilkinson[1872],13Wall, 222 Maxon vs. Llewelyn [1898], 122 Cal., 195, construing section 1856 of the Code of Civil Procedrue of California,identicalwithsection285oftheCodeofCivilProcedureofthePhilippines.) We hold that parole evidence was properly admitted to show the illegality of the contract of sale introduced as ExhibitA. http://www.lawphil.net/judjuris/juri1919/sep1919/gr_13300_1919.html
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3. The third point raised by appellant is, that the defendant, having accepted the donation expressed in the instrumentExhibit1,isnowestoppedfromdenyingtheconsiderationsetforththerein.Asufficientansweris,that ithavingbeenestablishedthatExhibitAisinvalid,suchaninstrumentcannotbemadethebasisofanestoppel. WeholdthatthesocalleddonationinfavorofMatildeCantiverosdidnotoperatetocreateanestoppel. 4.Thelastquestionwhichispropoundedbyappellantrelatestotheeffectoftheillegalityoftheinstantcontract. Itisrudimentarythatcontractingpartiesmaynotestablishpacts,clauses,andconditions,whichconflictwiththe laws, morals, or public order "public order" signifies "the public weal" public policy (Article 1255, Civil Code Manresa,ComentariosalCodigoCivil,Vol.8,p.574.)Itisfurtherwellsettled,thatapartytoanillegalcontract cannot come into a court of law and ask to have his illegal objects carried out. The rule is expressed in the maxims:"Exdolomalononorituractio,"and"Inparidelictopotiorestconditiodefendentis."Thelawwillnotaid eitherpartytoanillegalagreementitleavesthepartieswhereitfindsthem.(Article1306,CivilCodePerezvs. Herranz[1907],7Phil.,693.)Where,however,thepartiestoanillegalcontractarenotequallyguilty,andwhere public policy is considered as advanced by allowing the more excusable of the two to sue for relief against the transaction,reliefisgiventohim.Casesofthischaracterare,wheretheyconveyancewaswrongfullyinducedby the grantee through imposition or overreaching, or by false representations, especially by one in a confidential relation.(13C.J.,497499Pridevs.Andrew[1894],51OhioState,405.) Ascorroborativeexamplesoftheseprinciples,wemaycitethefollowing: Whereahusbandfalselyrepresentedtohiswifethatshewasliableforcertaindebts,andthatthecreditors wouldtakeherpropertyandinfluencedbythis,andintendingtodefraudsuchcreditors,shetransferredher propertytohim,itwasheldthatthedeedwouldbesetaside.(Boydvs.DelaMontagnie[1878],73N.Y., 498.) Where a party has given a conveyance of his property with intent to defraud a creditor, the law will allow himnoreliefagainstsuchconveyance,butwillleavehiminthesituationinwhichhehasplacedhimself.But wherethereisnocreditorinfact,butonlyanimaginaryone,throughfearofwhomthegrantor,encouraged bythegrantee,makestheconveyance,afraudulentintentwillnotbeimputedtothegrantor,andwherethe conveyanceofthepropertyhasbeenwithoutconsideration,hemayrecoverthesameoritsvalue.(Kervick vs.Mitchell[1885],68Iowa,273.) Whereasonfalselyrepresentedtohismotherthatasuitwasabouttobebroughtagainstherforslander whichwouldresultinherlosingallherproperty,andtherebyinducedhertoconveyallherpropertytohim, it was held that the conveyance would be set aside at her suit. (Harper vs. Harper & Co. [1887], 85 Ky., 160.) Whereawomanseventyyearsofageandilliteratewasinducedbyhersoninlawandthesuretiesonhis bondtoexecuteamortgagetothesuretiestoindemnifythemonadefalcationbythesoninlaw,byholding out to her the anticipated punishment of the latter, without allowing her a chance to consult any disinterestedfriend,itwasheldthatthemortgagewouldbesetaside.(Bellvs.Campbell[1894],123Mo., 1.) One who executes a bill of sale at the instance of the grantee for the purpose of putting his property beyond the reach of a third person whom the grantee represented was about to institute suit against the http://www.lawphil.net/judjuris/juri1919/sep1919/gr_13300_1919.html
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grantor,isentitledtorecoverthevalueoftheproperty,wheresuchthirdpersonhadnovalidclaimagainst the grantor, but had been settled with in full, and his receipt taken. (Kervick vs. Mitchell [1885], 68 Iowa, 273.) A brother who conveyed property to his sister on a secret trust for his benefit, to defeat any claim for alimonywhichhiswife,whohadinstitutedasuitfordivorce,mightmakeagainsthim,isentitledtoenforce thetrustuponwhichtheconveyancewasmade,whereitdoesnotappearthatanyclaimforalimonywas eversetupbyhiswife,orallowed,orthatfactsexistedentitlinghertosuchanallowance.Thecourtsaid: `It does not appear that there was any creditor whose rights or interests could be prejudiced by the conveyance,andthequestioniswhetherornotthemeremotivewhichimpelledthepartytomakethedeed will preclude him from enforcing the trust upon which it was executed. We think that where there is no creditor, there is no fraud, and therefore no policy of the law to prevent the enforcement of the trust. (Riveravs.White[1901],94Tex.,538.) Aconveyancemadebyamothertoadaughterinconsequenceoffalserepresentationsthatherproperty mightotherwisebetakenfromhertosatisfyaclaimforalimonyarisingfromasuitfordivorceabouttobe broughtagainsthersonbyhiswifewillbecancelled.TheCourtsaid:"Iftheconveyancewasmadeforthe purpose of protecting the property from such claim, such representations being untrue, and such apprehensionsinfactgroundless,thensheisentitledtohavethedeedssetaside."(Kleemanvs. Peltzer [1885],17Neb.,381.) Inthisinstance,thegrantor,reposingfaithintheintegrityofthegrantee,andrelyingonasuggestedoccurrence, which did not in fact take place, was made the dupe of the grantee, and led into an agreement against public policy. The party asking to be relieved from the agreement which she was induced to enter into by means of fraud,wasthusindelicto,butnotinparidelictowiththeotherparty.Thedeedwasprocuredbymisrepresentation andfraudsufficienttovitiatethetransaction.Therightsofcreditorsarenotaffected.Wefeelthatjusticewillbe doneifweplacethegrantorinthepositioninwhichshewasbeforethesetransactionswereenteredinto. The facts of this case are not greatly dissimilar from those to be found in Hibberd vs. Rohde and McMillian ([1915], 32 Phil., 476), relating to the defenses permissible where an instrument was submitted by the plaintiff, and not denied under oath by the defendant, and to the subject of contracts against public policy. The doctrine thereannouncedneednotbeincorporatedinthisdecision. Weresolveeachassignmentoferroragainsttheappellants,andhavingdoneso,affirmthejudgmentofthetrial court,withcostsofthisinstanceagainsttheappellants.Soordered. Arellano,C.J.,Torres,Johnson,Araullo,Street,AvanceaandMoir,JJ.,concur.
